1 in 4 UK SMEs at Risk of Cutting Staff Without Access To New Finance, Study Confirms

banking circle

Fear rises amongst SMEs’ employees as a quarter of UK small businesses would cut staff if the couldn’t access new finance to support the growth of their business, a brand-new white paper confirms. 

Lack of access to additional finance would force 25% of SMEs to let employees go. Nearly a third (30%) would have to reduce prices to encourage sales and increase cashflow, and 39% would be unable to buy the equipment the business needs, explained Anders la Cour, co-founder and Chief Executive Officer of Saxo Payments Banking Circle the company which commissioned the research. 

THE BATTLE FOR FINANCE. 92.5% of over 500 financial decision makers and directors in SMEs have accessed business finance within the past five years but many have experienced difficulties in borrowing from their usual bank.

Research slide

Source: ‘The Epic Business Loan Battle: SMEs fighting for finance’

Indeed, just 3% managed to get the finance arranged within a week. 33.3% took 1-2 weeks and 36.3% waited 3-4 weeks for the finance to be arrange.  2.1% of SMEs waited up to six months for their finance – a small percentage, but representing almost 120,000 businesses across the UK.

SMEs with 10-49 employees are the least satisfied with their current banking relationships.

THE BIGGEST CONCERN. Interest rates and fees were the biggest concern, with 58% saying they would consider finance from a non-bank if it offered lower interest rates.  44% would do so for lower arrangement fees. 25% would be attracted to a non-bank by simple online account management.

Find out more here

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